High-Beta Index Clinging to Support Level

The NASDAQ 100 (QQQQ) just can’t rally off what seems to be a strong support level at $47.00. While the index is firmly in a neutral state (so there isn’t a true bullish or bearish edge). We have been trading in a fairly tight range over the last two trading days so I would expect to see something give very soon. A push to the downside could trigger a few signals, but only if we can get an oversold reading. It has been quite some time since every index and sector ETF I follow for the options strategies have held in a neutral state. In the past when this type of event occurs (or should I say non-event) a sharp move typically follows.  Until then, as always, I will be patiently waiting on the sidelines for a signal to occur in one of our options strategies.

Have a wonderful night!

Andy

Overbought-Oversold levels for August 20, 2008

ETF Extremes Options Trading Strategy

* S&P 500 (SPY) - 42.6 (neutral)
* Dow Jones (DIA) - 40.3 (neutral)
* Russell 2000 (IWM) - 39.8 (neutral)
* NASDAQ 100 (QQQQ) - 40.3 (neutral)

Sector ETF Extremes Options Strategy

* Biotech (IBB) – 33.9 (neutral)
* Consumer Discretionary (XLY) - 37.9 (neutral)
* Health Care (XLV) - 40.7 (neutral)
* Financial (XLF) - 39.3 (neutral)
* Energy (XLE) - 66.9 (neutral)
* Industrial (XLI) - 31.9 (neutral)
* Materials (XLB) - 59.1 (neutral)
* Real Estate (IYR) - 34.5 (neutral)
* Retail (RTH) - 45.1 (neutral)
* Utilities (XLU) - 60.2 (neutral)

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